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Note 11 - Fair Value of Assets and Liabilities

12 Months Ended

Dec. 31, 2013

Fair Value Disclosures [Abstract]

Fair Value Disclosures [Text Block]

11. Fair Value of Assets and Liabilities:

The Company’s financial instruments include cash and cash equivalents, short-term trade receivables, derivative instruments, accounts payable and debt instruments. For short-term instruments, other than those required to be reported at fair value on a recurring basis and for which additional disclosures are included below, management concluded the historical carrying value is a reasonable estimate of fair value because of the short period of time between the origination of such instruments and their expected realization.

During 2013 and 2012, there were no transfers of financial assets between Levels 1, 2 or 3 fair value measurements. There have been no changes in the methodologies used at December 31, 2013 and December 31, 2012. Following is a description of the valuation methodologies used for assets and liabilities measured at fair value as of December 31, 2013 and December 31, 2012:

Nickel swaps and embedded customer derivatives – Determined by using inputs that include the price of nickel indexed to the LME. The fair value is determined based on quoted market prices and reflects the estimated amounts the Company would pay or receive to terminate the nickel swaps.

Interest rate swap – Based on the present value of the expected future cash flows, considering the risks involved, and using discount rates appropriate for the maturity date. Market observable Level 2 inputs are used to determine the present value of future cash flows.

The following table presents information about the Company’s assets and liabilities that were measured at fair value on a recurring basis and indicates the fair value hierarchy of the valuation techniques utilized by the Company:

		Value of Items Recorded at Fair Value
		As of December 31, 2013
(in thousands)		Level 1				Level 2				Level 3				Total
Assets:
Embedded customer derivatives		$	-			$	614			$	-			$	614
Total assets at fair value		$	-			$	614			$	-			$	614

Liabilities:
Nickel swaps		$	-			$	614			$	-			$	614
Interest rate swap			-				279				-				279
Fixed interest rate swap			-				710				-				710
Total liabilities at fair value		$	-			$	1,603			$	-			$	1,600

		Value of Items Not Recorded at Fair Value
		As of December 31, 2013
(in thousands)		Level 1				Level 2				Level 3				Total
Liabilities:
Debt
IRB		$	4,340			$	-			$	-			$	4,340
Term loan			-				48,854				-				48,854
Revolver			-				146,075				-				146,075
Total liabilities not recorded at fair value		$	4,340			$	194,929			$	-			$	199,269

The value of the items not recorded at fair value represent the carrying value of the liabilities.

		Value of Items Recorded at Fair Value
		As of December 31, 2012
(in thousands)		Level 1				Level 2				Level 3				Total
Assets:
Embedded customer derivatives		$	-			$	113			$	-			$	113
Total assets at fair value		$	-			$	113			$	-			$	113

Liabilities:
Nickel swaps		$	-			$	168			$	-			$	168
Interest rate swap			-				446				-				446
Fixed interest rate swap							941								941
Total liabilities at fair value		$	-			$	1,555			$	-			$	1,555

		Value of Items Not Recorded at Fair Value
		As of December 31, 2012
(in thousands)		Level 1				Level 2				Level 3				Total
Liabilities:

Debt
IRB		$	5,125			$	-			$	-			$	5,125
Term loan			-				57,604				-				57,604
Revolver			-				177,575				-				177,575
Total liabilities not recorded at fair value		$	5,125			$	235,179			$	-			$	240,304

The value of the items not recorded at fair value represents the carrying value of the liabilities.

The fair value of the IRB is determined using Level 1 inputs. The carrying value and the fair value of the IRB that qualify as financial instruments were $4.3 million and $5.1 million, respectively, at December 31, 2013 and 2012.

The fair values of the revolver and term loan are determined using Level 2 inputs. The carrying values of the revolver and the term loan were $146.1 million and $48.9 million, respectively, at December 31, 2013. The carrying value of the revolver and the term loan were $177.6 million and $57.6 million, respectively, at December 31, 2012. The Level 2 fair value of the Company's long-term debt was estimated using prevailing market interest rates on debt with similar creditworthiness, terms and maturities.

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

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